Volvo buys Polestar to develop sportier, high performance cars

Article by Andrew Christian, on July 14, 2015

Volvo Cars, which has recently purchased Swedish race-car maker Polestar, seeks to be able to compete with Mercedes-AMG and BMW's M models. Volvo will be using this name for a bigger high-performance range. Under a cooperation agreement entered in 2013, Volvo has already started to sell Polestar-tuned versions of the V60 wagon and S60 sedan.

In a statement, CEO Hakan Samuelsson said that Volvo will utilize its full resources to develop Polestar further and for more Volvo owners to experience what Polestar has to offer. The automaker will offer sportier versions of its regular models, a move that is copied from Jaguar Land Rover, BMW and Mercedes-Benz.

The automaker also said that it has raised its estimate for Polestar sales from 750 units this year to about 1,500 units in the medium term. The monetary details of the deal weren’t revealed. The acquisition does not include the racing unit of Polestar as it remains to be controlled by racecar driver Christian Dahl, its owner and CEO.

This racing unit has been collaborating with Volvo. The U.S., the U.K. and Australia are the largest markets for Volvo’s Polestar sporty versions. Polestar, which has an exclusive cooperation deal with Volvo, makes use of performance-enhancing software and tunes cars to improve the mid-range engine performance by revising the gearbox and throttle response.

In motor sport, the relationship between Volvo and Polestar began in 1996. Volvo will absorb the current Polestar Performance employees as its own. Volvo has set a target of half a million cars this year. But by the end of the decade, it aims to increase its worldwide annual sales to 800,000 units.

In 2014, Volvo was able to sell 465,866 cars. Zhejiang Geely Holding Group Co. bought Volvo from Ford five years ago. Christian Dahl said that he is “extremely satisfied” with the development of the performance business with Volvo. He pointed out that his company is a “racing team” and that this represents an opportunity to focus on its core business, which is to “develop and race Volvo cars.”

Press Release

Volvo Cars buys 100 per cent of Polestar

Volvo Cars, the premium car maker, has acquired 100 per cent of Polestar, the Swedish high performance car company, including the Polestar brand. Polestar will now be used as the model name for special high performance Volvos.

Polestar will also in future utilise Volvo's twin engine electrification technology to develop next generation performance cars.

Volvo is the largest manufacturer of plug in hybrid cars in Europe and leader in advanced vehicle electrification technology. Volvo currently develops and manufactures some of the most powerful, most environmentally-friendly hybrid engines in the automotive industry.
Volvo S60 Polestar, model year 2016

Volvo and Polestar share a long history. They have been working in motor sport since 1996 and in recent years signed a cooperation agreement to jointly develop Polestar versions of Volvo cars that combine a comfortable Volvo driving experience with a very high level of power and handling.

"Driving a Volvo Polestar is a special experience. We have decided to bring this experience to more Volvo drivers, placing the full resources of Volvo behind the development of Polestar as the model name for our high performance cars," said Håkan Samuelsson, president and chief executive of Volvo Cars.

In 2015, Volvo expects to sell 750 Polestar versions of the V60 wagon and S60 sedan globally. Polestar sales are forecast to increase to between 1,000 and 1,500 cars a year in the medium term under Volvo's ownership.

The Polestar brand is already firmly established internationally through the sale of Polestar-branded Volvos. Volvo will also benefit from the sale of aftermarket Polestar performance optimisation kits for existing Volvos.

No financial details of the deal have been disclosed. Existing Polestar Performance employees will become Volvo employees.

The Polestar racing team will remain under the control of Christian Dahl, the former owner of Polestar, and will be renamed. The Polestar brand will continue to work alongside Christian Dahl.

"We are extremely satisfied with the way the performance business with Volvo has developed. But we are a racing team first and foremost. This is an opportunity to return our full attention to our core business – to develop and race Volvo cars," said Christian Dahl.

Topics: volvo, polestar

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